SB 3021: DCCA; Consumer Protection; Food Establishments; Fees and Surcharges; Disclosure Requirements; Advertising; Food and Beverages; Unfair and Deceptive Practices; Rules

A BILL FOR AN ACT

relating to CONSUMER PROTECTION.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that the restaurant industry has been greatly affected by the rising costs of living and doing business following the COVID-19 pandemic.  In particular, businesses have been challenged by the increase in supply costs, utilities, and food expenses.  The legislature finds that businesses serve a vital role in the community, and that it is important to support business efforts and to encourage creative price control methods that do not detract from consumer satisfaction.

     The legislature finds that as restaurants and food service establishments find new ways to operate in the face of these challenges, some restaurants have included an additional hidden fee in bills, referred to as a "Supply Chain Adjustment" fee, which can be up to ten per cent of the total meal cost.  The public has expressed confusion about this and other additional fees at establishments where the ineffective notification of fees left patrons feeling misinformed about their choices as consumers.

     The legislature finds that increasing prices to keep up with supply costs is a natural part of doing business.  However, hiding fees from consumers and then forcing them to pay at the end of their meal or upon receiving their order is not only dishonest, but according to the office of consumer protection, a practice that is illegal.

     The legislature finds that a clear and comprehensive notice of additional fees and other details that affect the prices of menu items and the total bill for restaurant patrons would function to protect consumers and provide restaurants the opportunity to strategize their approach to offsetting business costs.

     Accordingly, the purpose of this Act is to:

     (1)  Require each food establishment to clearly and conspicuously display, when a price is shown to a customer, the total price of that food or beverage item, including any mandatory fees a customer would incur during the purchase; and

     (2)  Require the department of commerce and consumer affairs to adopt rules to carry out this Act.

     SECTION 2.  Chapter 481B, Hawaii Revised Statutes, is amended by adding a new section to part I to be appropriately designated and to read as follows:

     "§481B-    Food establishment fees and surcharges; disclosure requirements.  (a)  Each food establishment shall clearly and conspicuously display, when a price for a food or beverage item is shown to a customer, the total price of that food or beverage item, including any mandatory fees a customer would incur during the purchase.

     (b)  A food establishment shall not impose on a customer or advertise any mandatory fees that are excessive or deceptive for any food or beverage offered by the food establishment.

     (c)  The department of commerce and consumer affairs shall adopt rules pursuant to chapter 91 to carry out the purposes of this section.

     (d)  For the purposes of this section:

     "Customer" means a person who purchases food or beverages from a food establishment.

     "Food establishment" means an eating establishment, including but not limited to restaurants, coffee shops, cafeterias, sandwich stands, and food trucks, that gives or offers for sale food to the public, guests, or employees, as well as kitchens and catering facilities in which food is prepared on the premises for serving elsewhere.  "Food establishment" includes a bar area within any restaurant or outdoor area of a restaurant.

     "Mandatory fee" includes:

     (1)  Any fee or surcharge that a customer is required to pay to purchase the food or beverage being advertised;

     (2)  A fee or surcharge that is not reasonably avoidable; or

     (3)  Any other fee or surcharge determined appropriate by the department of commerce and consumer affairs."

     SECTION 3.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 4.  New statutory material is underscored.

     SECTION 5.  This Act shall take effect upon its approval.

Report Title:

DCCA; Consumer Protection; Food Establishments; Fees and Surcharges; Disclosure Requirements; Advertising; Food and Beverages; Unfair and Deceptive Practices; Rules

Description:

Requires each food establishment to clearly and conspicuously display, when a price is shown to a customer, the total price of that food or beverage item, including any mandatory fees a customer would incur during the purchase.  Prohibits a food establishment from imposing on a customer or advertising any mandatory fees that are excessive or deceptive for any food or beverage offered by the food establishment.  Requires the Department of Commerce and Consumer Affairs to adopt rules.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.